Mike McCarron | July 2, 2018 Takeaway: Be sure to take the following steps before deciding to sell your business. You’ve decided it’s time to get out of the rat race. It’s going to be a lot more fun chasing golf balls than truckloads. You figure that selling your company should be no different than selling your house: Hire an agent (investment banker), write a fancy presentation and create an auction to jack up the price. Before you pitch the
Chad Byers | December 4, 2017 Takeaway: Every business owner wants to maximize their value, particularly when it comes time to sell. Here are some ways you can do just that: When the time comes to sell your business, there is one consideration that will likely stand out among all others in your mind: valuation. No matter the time of the sale — years after starting your business or months after purchasing it — high valuation is always a priority.
You’ve got investors lined up. Great! But how much is their help going to cost you, really? By Ed PowersHead of Capital Access Funds, Bank of America What’s the real cost of capital for your business? Do you know? Or just think you do? The concept of cost of capital comes straight out of Finance 101: When a business raises capital, how much does that capital cost? Business owners know with certainty the cost of their other
BUSINESS WIRE)–Business valuations – the primary means by which businesses are evaluated in the investment process – have been significantly increasing according to new results from the 2018 Private Capital Markets Project from Pepperdine Graziadio Business School. Survey respondents from investment banks report that average company valuation multiples have increased from 8.0 to 8.7 times recast Earnings Before Interest Taxes Depreciation and Amortization (EBITDA) for firms with EBITDA between $25-50 million. The increases are similar
By Kaye A. Thomas Guidance on tax rules for stock grants or awards. If you work for a corporation, you may receive compensation in the form of stock of that corporation (or perhaps the parent of that corporation). If the stock is vested when you receive it, you have to report compensation income at that time. Otherwise the stock is restricted, and you won’t report compensation income until the stock vests. Terminology: Various terms we use in
Steve Parrish I was working with a business owner on ideas for retaining a key employee. The employee was threatening to leave for a higher paying job, declaring “I love working here, but if I’m going to stay, I want to have some skin in the game.” I started explaining to the owner why he should avoid offering the key employee stock as an incentive. He stopped me, and asked that I first give him
Mike Finger Is your business dependent on you? You rightly answer, “Of course it is you idiot, I’m a small business owner.” It’s completely understandable. You started the business from nothing. In the beginning it was only you. You made the difference. 1,000 times the only reason the business survived was because you tackled the problem. You closed the new client. You found the money. You stayed at work until 3 a.m. to make it happen. You’ve learned to rely on yourself, but
By Elvin Mirzayev, CFA, FRM | Updated January 23, 2018 — 9:44 PM EST In equity valuation theory and practice, we generally encounter two valuation approaches: discounted cash flows (DCF) and comparables. The DCF Model The DCF model refers to a group of approaches that are also called “present value models.” These traditionally assume the value of an asset equals the present value of all future monetary benefits. This model is easy to use when the future cash benefits are known or can be
December 19, 2017 People don’t want advice. They want the pain to go away. They want to keep doing the same thing but get different results. The world is full of answer-givers, but who can find a skillful advisor? What kind of advisor are you? Expert. You know something others need to know. Perhaps you have relevant technical knowledge. Experienced. You’ve been there and done that. You’ve failed and learned. Skilled. You have relevant abilities? Problem-solving.
Takeaway: Working capital management is just as important as revenue growth and profitability when creating value in your company as you prepare to sell it. Most company owners will agree on this: landing a big order or project is fun, balance sheet management is anything but. That’s why company owners often leave managing receivables and payables up to the accountants. This is a mistake. When companies are growing, letting receivables run can lead to a cash